Guidelines for Requesting a Waiver from Competitive Bidding

1. Guidelines for Requesting a Waiver from Competitive Bidding Procure to Pay Services Updated 2/1/2012 Table of Contents

2. Table of Contents (Page 1 of 2) • General Information • When is my purchase a candidate for a waiver? (Page 1 of 2) • When is my purchase a candidate for a waiver? (Page 2 of 2) • Under what circumstances is a waiver granted? (Page 1 of 2) • Under what circumstances is a waiver granted? (Page 2 of 2) • Under what circumstances is a waiver denied? (Page 1 of 3) • Under what circumstances is a waiver denied? (Page 2 of 3) • Under what circumstances is a waiver denied? (Page 3 of 3) • Can I split my purchase to avoid the bid limit? Next

3. Table of Contents (Page 2 of 2) • How do I request a waiver? • What happens to my request? • What happens next if my waiver request is denied? • Can I protest a denial? • My original purchase order to the supplier was under the bid limit, but I need to request a change that will put it over the limit. What now? • People in my department inadvertently violated University purchasing policy and a supplier has already started work that will cost over the bid limit. It’s too late to turn back. Now what? • Any Questions? Back Next

4. General Information • With some exceptions, all purchases, that represent a commitment of over the bid limit, per fiscal year, per supplier, must be bid. • Bid limits: • Goods: $25,000 • Services: $50,000 • Construction: $50,000 • The Purchasing & Contracting Office often receives questions about the procedure for requesting a waiver from the competitive bidding requirement. Table of Contents

5. When is my purchase a candidate for a waiver? (Page 1 of 2) • Your purchase is a candidate for waiver if (and only if) all of the following circumstances apply: • You are requesting a purchase greater than the bid limits. The dollar amount of the entire purchase should be considered, not the value of the individual items. • A purchase may not be pyramided - i.e., it may not be split for the primary purpose of avoiding bidding requirements. • NOTE: With some exceptions, all purchases, that represent a commitment of over the appropriate bid limit amount, per fiscal year, per supplier, must be bid. Table of Contents

6. When is my purchase a candidate for a waiver? (Page 2 of 2) • The supplier selected is not already on contract. If a supplier is already on contract (prior to this purchase), bidding is not required, regardless of dollar amount. • For information if your supplier has a contract with the university, please send an email to: financecustomercare@ohio.edu or call 740.597.OHIO (6446). Table of Contents

7. Under what circumstances is a waiver granted? (Page 1 of 2) • Whether or not the waiver request will be approved depends on how strong a case you make. Here are some common grounds under which a waiver will be granted: • The supplier is obviously a sole source for the item. Examples: • Artwork • Unusual and not generally available used equipment • A very specialized piece of scientific equipment • Specialized service (e.g., lobbyists, consultants) when the supplier has a one-of-a-kind ability to provide the required service due to demonstrably unique circumstances (knowledge, contacts, experience, etc.). • It is helpful if you provide documentation from an independent source if you are making sole source claim (i.e. article from a scientific journal). Table of Contents

8. Under what circumstances is a waiver granted? (Page 2 of 2) • There is an undeniable compatibility requirement. The item(s) will be hooked up to existing equipment, or the purchase is an upgrade to existing software, etc. • There has been an unpredictable emergency, and there is no time for a bid (i.e. equipment that provides a vital service to campus breaks down unexpectedly. Repair or replacement will cost more than the bid limit, but a waiver is needed to allow work to begin immediately to meet the emergency need.) • The purchase of this very particular item is part of an existing grant agreement, or joint agreement elsewhere. Conditions of a pre-existing, authorized agreement (with a granting agency or research partners outside the University) specify the use of a very specific item and supplier. Table of Contents

9. Under what circumstances is a waiver denied? (Page 1 of 3) • Here are some common examples of what does not work: • "We did some looking around, and this supplier is offering a very good deal.” • This may be true - but a formal competitive bid process, conducted by the Procurement Services, is what is used at the University to document that claim, and to document the integrity of the process used to make the final supplier selection. • The competitive bidding process demonstrates that due diligence was used in spending tax payer dollars, and that fair business practices were used. • REMEMBER: Internal and external auditors, suppliers unhappy with not being selected, the news media, or any interested person can (and do) request information on supplier selection processes. Table of Contents

10. Under what circumstances is a waiver denied? (Page 2 of 3) • "I waited so long to work on this, that now I need it tomorrow." • Procurement Services will work with you to make the competitive selection process happen as quickly as possible - but it still has to happen. • “It would be so much more convenient if we could use this supplier” (or “if we could have this done a little sooner.”). • Unfortunately, convenience is not a strong enough factor to allow the granting of a waiver from competitive bidding. An emergency situation must be present. Table of Contents

11. Under what circumstances is a waiver denied? (Page 3 of 3) • "I already promised the sales rep" - or - "I already have the item" - or "The company has already started work." • Making such purchases or agreements at a departmental level is contrary to University policy. • The promise must be taken back, the item must be returned, the company must stop work - and a competitive bidding event must take place. • If this has already occurred, please click here.

12. Can I split my purchase to avoid the bid limit? • No, a purchase may not be split for the primary purpose of avoiding bidding requirements. Table of Contents

13. How do I request a waiver? • Please click here and select the Request for Waiver form. • Please out the form as shown and sign it. • Attach the signed and completed form to a requisition. • Make a note in the body of the requisition, stating: “Request for Waiver attached.” • Attach written confirmation of the pricing. • Take care to provide an accurate, thorough, explanation of the circumstances on your form. Table of Contents

14. What happens to my request? • Once it arrives in Procurement Services, it is reviewed. • If the request is denied: The requestor will be notified. • If it is approved, the purchase order notification to the requestor serves as notification. Table of Contents

15. What happens next if my waiver request is denied? • The purchase will be put out on competitive by Procurement Services. • You may be required to provide more information regarding specifications and needs. Once the bids are received, you (and others involved, as appropriate) will be asked to review the results and make a selection. • If you wish to select a supplier other than the low bidder, you will be asked to supply a justification memo. This memo must provide solid, defensible reasoning for the selection. The Procurement Commodity Manager involved will guide you through this process. Table of Contents

16. Can I protest a denial? • Yes. If you feel you were unfairly denied, please first talk first to the Procurement Commodity Manager involved. • The University Legal Affairs Office may arbitrate. The Legal Affairs Director will prepare a memo detailing their decision. Table of Contents

17. My original purchase order to the supplier was under the bid limit, but I need to request a change that will put it over the limit. What now? • A waiver can be granted if an unforeseeable complication caused an unexpected cost overrun. Use the following procedure: • Obtain and complete a Request for Change Order form. • Obtain a Request for Waiver form to request a waiver from competitive bidding. • When you complete the Request for Waiver form, please describe the nature of the unforeseeable complication, and request a waiver. Table of Contents

18. People in my department inadvertently violated University purchasing policy and a supplier has already started work that will cost over the bid limit. It’s too late to turn back. Now what? • This is a serious violation of University Purchasing policy. A Requisition for the entire purchase should be sent to Procurement Services immediately. • Please attach a memo describing the circumstances to the best of your ability. • The memo should explain why such an irregular route, contrary to University policy, was taken. • It should also explain why the work or acquisition cannot be halted. • It must indicate a current understanding of University purchasing policy, as well as clear intent to follow University Purchasing policy in the future. • Depending on several factors (i.e. overall cost of the purchase, the requestor’s history in regard to Purchasing policy violations - one of two things will happen: • A one time exception will be made, allowing the supplier to be paid on University funds. • An exception will not be made, and since the purchase was made absent any formal agreement by the University, the University is not obligated. Liability for the expense becomes a personal obligation to the requestor. Table of Contents Any Questions

19. Any questions? • Please contact us by sending an email to: financecustomercare@ohio.edu or you can call 740.597.OHIO (6446). Back to Table of Contents